G.R. No. 177059 March 13, 2009
FE LA ROSA, OFELIA VELEZ, CELY DOMINGO, JONA NATIVIDAD and EDGAR DE LEON, Petitioners, vs. AMBASSADOR HOTEL, Respondent.

FACTS

Petitioners, employees of Ambassador Hotel, filed several complaints before the National Labor Relations Commission (NLRC) for illegal dismissal, illegal suspension, and illegal deductions. They alleged that after they filed complaints with the DOLE-NCR which led to an inspection and a finding of labor standards violations by the hotel, the hotel’s management retaliated by suspending and/or constructively dismissing them through a drastic reduction of work days via a work reduction/rotation scheme. The labor arbiter found the hotel and its manager guilty of illegal dismissal and ordered payment of separation pay, backwages, and attorney’s fees. The NLRC affirmed with modification, specifically finding petitioner Edgar de Leon actually but illegally dismissed on November 7, 2001, and petitioners Fe La Rosa, Ofelia Velez, Cely Domingo, and Jona Natividad constructively dismissed on April 15, 2002. The Court of Appeals reversed the NLRC, dismissing the complaints, holding there was no constructive dismissal as petitioners “simply disappeared from work” upon learning of the work scheme, and that the scheme was a valid exercise of management prerogative due to business reverses. The appellate court also noted petitioners only prayed for separation pay and not reinstatement. Petitioners filed the present petition, denying abandonment and asserting they did pray for reinstatement in their position paper and pro-forma complaints.

ISSUE

Whether the Court of Appeals erred in reversing the NLRC’s finding that petitioners were illegally dismissed, specifically: (1) in ruling that petitioners abandoned their jobs; (2) in holding the work reduction/rotation scheme was a valid exercise of management prerogative; and (3) in finding petitioners did not pray for reinstatement.

RULING

The Supreme Court GRANTED the petition, REVERSED and SET ASIDE the Court of Appeals Decision and Resolution, and REINSTATED the NLRC Decision and Resolution.
1. The Court found that respondent failed to prove petitioners abandoned their jobs. Abandonment requires a clear intention to sever the employer-employee relationship, manifested by overt acts. Respondent failed to discharge the burden of proof. Petitioners’ immediate filing of complaints for illegal dismissal after the implementation of the work scheme negates any claim of abandonment.
2. The Court held that the work reduction/rotation scheme constituted constructive dismissal. Respondent’s sudden, arbitrary, and unfounded adoption of a two-day work scheme, which greatly reduced petitioners’ salaries, rendered continued employment unreasonable. The appellate court’s finding that the scheme was due to business reverses was not supported by documentary proof. The scheme was implemented almost immediately after petitioners’ labor standards complaints were partially settled.
3. The Court ruled that petitioners did pray for reinstatement. The records show that in their pro-forma complaints and Position Paper, petitioners specifically prayed for “reinstatement with full backwages, or in the alternative to full separation pay.” Furthermore, under Article 279 of the Labor Code, an employee illegally dismissed is entitled to reinstatement and backwages or separation pay.
The Court concluded petitioner Edgar de Leon was illegally dismissed on November 7, 2001, and the other petitioners were constructively dismissed on April 15, 2002.